Iceland profits skyrocket as it sidesteps recession

Revenues at the frozen foods specialist soared 16 per cent to £2.08bn in the year to March 27. EBITDA jumped 36 per cent to £163m, and net profit before tax rocketed 84 per cent to £113.7m. Like-for-like sales rose 16 per cent.

It was the fourth consecutive year of double-digit like-for-like growth for the 723-store retailer. The dazzling performance has continued into the current year, with like-for-like sales up in double digits. Walker said Iceland's continued success is down to "great management - the best we have ever had" and "the massively increased morale" of its 20,000 staff in the four years since he returned to the retailer.

He said Iceland - which he founded with £30 in 1970 and ran until he was frozen out in 2001 - had grown in both boom and bust times. "Recession, what recession? We are not taking part. You can talk about our marketing, product and pricing strategy, but do not underestimate staff morale."

He added that the retailer has managed a sustained recovery by remaining "focused". It emerged unscathed from the downfall in February of Icelandic investor Baugur, which had a 14 per cent stake in the business.

Walker said Landsbanki - the nationalised Icelandic bank that now holds Baugur's stake - has no plans to sell its holding at present.

He said Iceland was taking share "a little bit from everyone" in a growing market, in which it commands just under 3 per cent at present. He said customers have begun to understand the benefits of frozen food, including the advantages of creating less waste.

Walker does not expect growth to be sustained at the levels recorded last year. He said: "We can't go on with 16 per cent like-for-like growth. That would make us bigger than Tesco."

However, he remains optimistic about the current year's prospects as Iceland continues to offer customers value.

The retailer will open 20 stores this year on top of 51 former Woolworths shops that will be reopened as Iceland.